Wise new home buyers take the time to determine the most sensible mortgage plan and budget for a down payment. These may seem like the most obvious costs of buying a home, but there are a number of additional expenses to budget for when preparing for a real estate purchase.
Some of these added expenses, such as moving and renovation costs, may be avoidable for some home buyers. But there are other costs including insurance and taxes that all home buyers need to work into a budgetary plan.
Expenses to plan for
Rather than waiting until after a sale is final to understand all the financial responsibilities of purchasing and owning a home, take the opportunity beforehand to prepare a comprehensive plan. Everyone looking to enter the real estate market should prepare for a few main costs, including:
- Closing costs
- Increased utilities
- Interest on a mortgage
- Homeowners insurance
- Appraisal fees
- Property inspections
Every home sale is different and every home buyer is different, but they should all prepare for some amount of additional costs beyond a down payment and mortgage. Home inspections can cost a couple hundred dollars while taxes and closing costs can reach into the thousands.
Some fees vary based on the price and location of a home, but Maryland home buyers can expect to pay just under the national average for homeowners insurance. According to the Insurance Information Institute, U.S. homeowners pay an average of around $1200 while in Maryland that number is closer to $980.
How to prepare for the whole cost
It's important to go into a home purchase as prepared as possible. Don't let the confusion of buying property for the first time wind up damaging your financial future for the long haul. Utilize the tools and resources available to best prepare for all the costs and considerations of buying a new home. Skilled financial and real estate experts can guide even novice home buyers through the process and work to ensure a healthy, happy financial future to be lived out in your new home.